The Central Government is all set for announcing a 3% increase in DA and DR for about 1.2 crore Central Government employees and pensioners. The hike will raise the rate from 55 to 58 percent and will be considered effective from July 2025. The decision will be taken in early October just in time for the Diwali celebrations.
What The Increase Means
This increase in DA to 58% will provide slight increments in salaries and pensions. The revision will come with arrears from July to September, which employees and pensioners will probably get in October.
An employee drawing a basic pay of ₹50,000, with a DA previously at ₹27,500 at 55%, shall see a hike now at 58% to ₹29,000, an additional amount of ₹1,500 on a monthly basis. Likewise, a pensioner whose basic pension is ₹30,000 will witness the DR going up from ₹16,500 to ₹17,400, conferring an extra ₹900 every month.
Calculation & Basis For The Hike
The correspondence to hike is derived from the application of the Consumer Price Index for Industrial Workers (CPI-IW) under the Seventh Pay Commission. The relevant data of July 2024 to June 2025 showed average CPI-IW of 143.6, which amounts to DA of 58%. Since DA is revised twice annually for Jan-June and July-Dec, this hike is, therefore, for the July-December 2025 period.
Why Should This Matter?
This is going to be the last regular DA hike on the Seventh CPC, as it expires on 31st December 2025. Though the 8th Pay Commission has now been constituted, its staffing, terms of reference, and fine details of implementation are yet to be finalized. The full implementation of the 8th CPC recommendations will probably happen only in late 2027 or early 2028; meanwhile, this hike will come as good relief to government employees and pensioners in times of soaring inflation.
What Must The Employees Look Out For
- The official announcement concerning the DA/DR increase and rate confirmation of 58%.
- Payment of arrears for the three-month period of July-September 2025.
- October salary slips/pension slips reflecting the hike.
- Any modifications of the salary structure resulting from new or revised rules that come about under the 8th Pay Commission.
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